France's Engie agrees to buy 40% stake in Tabreed from Mubadala

19 June, 2017

Labourers walk past a Tabreed building in Dubai March 8, 2010. Tabreed is Middle East's largest district cooling firm.

REUTERS/Jumana El Heloueh

ABU DHABI, June 19 (Reuters) - French gas and power group Engie SA has agreed to buy a 40 percent stake Dubai-listed National Central Cooling Company PJSC (Tabreed) for 2.8 billion dirhams ($762.34 million) from Abu Dhabi's state investor Mubadala Investment Co. Engie will become Tabreed's second-biggest shareholder after Mubadala, which will retain a 42 percent stake in a deal that is subject to regulatory approval, the two companies said on Monday.

Mubadala which owned about 82 percent of Tabreed through a combination of equity and mandatory convertible bonds (MCBs) will be converting all its MCBs into shares or equivalent to 40 percent shareholding in Tabreed that will be transferred to Engie at a price of 2.62 dirhams per share.

The two companies have also agreed certain cooperation arrangements that are designed to support Tabreed's growth strategy and management team, they said.

Reuters had reported in November that Mubadala was considering the sale of a least part of its stake Tabreed.

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"Tabreed is a company with a strong growth trajectory and will benefit from Engie's experience as an operator of world-class utility businesses," said Homaid al Shimmari, deputy group chief executive of Mubadala in a statement, adding that Mubadala will continue to be a significant, long-standing shareholder in Tabreed.